“In fact, inflationary surprises have been showing signs of stabilization in the different geographiesor at least, inflation is not generating upward surprises as it had been doing until the second quarter of this year”, added the study.
In any case, it was clarified that the global inflationary outlook “remains mixed, since, although July’s inflation behaved benign in the United StatesAugust data in Europe showed a alarming sign of second-round effects.
“Most likely, what we see soon is that global inflation begins to subsidewhich was caused by an excess of emission that began in the pandemic but that inexplicably continued during 2021 and that causes an inflation of 8% or 9% year-on-year in developed countries”, agreed Aldo Abram, director of the Liberty and Progress Foundation.
“Evidently, If they continue along this path of monetary austerity, which is being implemented, for example, by the Federal Reserve and to a lesser extent by the European Central Bank, it is very likely that inflation will tend to slow down. What is also going to help some prices fall is, fundamentally, that the impact that the Russian invasion of Ukraine had on some markets is assimilated in some way,” Abram added to Ámbito.
In that sense, from Balanz they pointed out that, with different degrees of magnitude, “inflation would have reached its peak in July-August throughout a good part of the geographies”. “To level regionalthe consensus of economists surveyed in Bloomberg is that inflation would have peaked in the third quarter of 2022thus projecting forward a gradual decline”, the study pointed out, although it clarified: “However, there are differences between countries since Europe still has inflationary risks ahead. Within emerging markets, convergence in price dynamics it would take a few more months in countries like Argentina and Turkey, at least in terms of projections and expectations. For the rest of the economies, the worst of the inflationary shock would be a thing of the past”.
Inflation: what is expected for Argentina
Although after the peak of 7.4% monthly in July, projections show that local inflation will tend to slow down, will continue at very high levels. In that scenario, the lower international pressures will have a marginal effect on the evolution of local prices.
“External factors, in our inflation, had a marginal impact: could have hit 5 or 6 percentage points in total. This is what hit the developed countries. The rest is all ours. We could say that instead of having 96% inflation in the year, we would have had 90%. There is not much difference, obviously, “said Abram in this regard.
“The main responsible for inflation in Argentina are the Government and a Central Bank that does not stop issuing pesos, taking credibility away from our currency and therefore making people stop demanding pesos. The excess supply and the fall in demand for pesos causes it to lose purchasing power and enhances the impact on the total prices of goods and services. That is to say that the main problem of inflation in Argentina does not come from outside, it is internal”, added the director of Libertad y Progreso.
That is why, different analysts agree, inflation could continue above 6% in the coming months. “Inflation will have a drag on the macroeconomic imbalance, to which is added the correction of the regulated prices of the economy, such as public utility rates. This puts a high floor on inflation for the coming months, which could end in 95% annual inflation,” said Damián Di Pace, director of the Focus Market consultancy.
Source: Ambito
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